Eskom has announced plans to disconnect bulk electricity supply to a Free State municipality after its debt to the utility rose to more than R328 million. The energy company revealed that the municipality has not made any substantial payments since 2021, leaving Eskom with no choice but to enforce measures under the Administrative Justice Promotion Act (PAJA).
Despite warnings, the municipality’s debts are increasing
The municipality owes the utility company R328 711 887 for bulk electricity, excluding an additional R3 682 099 from the current bill. The last payment received, just R150,000, was made on October 5, 2021. Eskom stated that the municipality collects revenue from its residents for electricity services but retains the portion owed to the utility.
“This is unsustainable,” the utility said in a statement.
“The municipality charges fees and collects money but fails to meet its obligations to Eskom, putting the national electricity supply at risk.”
Eskom stressed that the municipality’s default has undermined its ability to operate sustainably, warning that further default will damage the country’s economic stability.
Daily power outages are planned
Should the If the lockdown continues, residents and businesses in affected areas will experience daily disruptions from January 31, 2025. The utility company clarified that this measure aims to prevent further financial tensions.
“Eskom appreciates the hardship that the community and the economy will suffer if it were to exercise its legal powers to disconnect the municipality. There are no other meaningful options available to Eskom to stop debt growth and recover debt for current consumption through bulk supply.”
Eskom has invited affected stakeholders to submit written comments by January 6, 2025, to propose alternatives or justify why the disconnection should not take place. A final decision will be communicated no later than January 16, 2025.
Stakeholders urged to break the impasse
Eskom pointed out that stakeholders have been working since 2021 to help the municipality address its debt. Despite these interventions, the situation remains unresolved.
“Despite all options Eskom has explored and attempts to accommodate the municipality, the matter has reached a point where Eskom simply can no longer afford to accommodate the municipality without further financial pressure and damage to its own business,” said the utility company.
“The municipality has breached these obligations by failing to pay Eskom for the bulk power it supplies, making it impossible for Eskom to fulfill its mandate.”
Eskom’s firm stance highlights the seriousness of the national utility’s financial challenges as it continues to look for ways to maintain electricity supplies across the country.
Do you think Eskom’s measures strike the right balance between debt collection and community well-being?
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Nozibusiso Mazibuko
www.thesouthafrican.com